Activist investors are here to stay. Activists have always been here, only the tactics have changed. Warren Buffett started his career as an unwelcome activist investor. Over the years, his style evolved into teddy-bear warmth and aw-shucks media savvy. The activists of the 1980’s and 1990’s have similarly changed their style. Personal confrontations are fading.
This data focuses on Whale activist investors, who can show up at companies through Trojan Horses.
New, unfamiliar institutional investors calling on CFOs, requesting meetings, could be Trojan Horses for activist investors.
Trojan Horses visit companies to size up management; to predict the reception an activist investor will receive; and to judge management’s readiness for a fight.
Trojan Horse activist investors use this information to develop an investment thesis and to inform the approach plan for a larger activist investor. The Whales have more financial resoures to engage with a company. Trojan Horses earn up to 30% of a Whale’s profits in an investment.
The SEC has noted that these private transactions are not being publicly disclosed when required. When a Whale Activist Investor’s holding exceeds 5% beneficial ownership, they must file a 13-D with the SEC. This filing should disclose finder fee arrangements. Learn more: Read Susan Pilliam’s article on WSJ.com [$].
Companies need to have their doors open to new investors.
Our advice to CEOs and CFOs is, “know who you’re talking to, know your vulnerabilities, and know your shareholders.”
Read This: The spreadsheet is for information purposes only. Users should conduct their own researh of SEC filings. LaMagna + Associates is not responsible for errors or omissions in the spreadsheet. This spreasheet is constantly changing, and is not a complete data set of all publicly traded Bay Area companies nor of all large activist, institutional shareholders.